DRS Dilip Roadlines Ltd.
|BSE: 535126||Sector: Others|
|NSE: DRSDILIP||ISIN Code: INE02CV01017|
|BSE 05:30 | 01 Jan||DRS Dilip Roadlines Ltd|
|NSE 05:30 | 01 Jan||DRS Dilip Roadlines Ltd|
|BSE: 535126||Sector: Others|
|NSE: DRSDILIP||ISIN Code: INE02CV01017|
|BSE 05:30 | 01 Jan||DRS Dilip Roadlines Ltd|
|NSE 05:30 | 01 Jan||DRS Dilip Roadlines Ltd|
Your Directors take pleasure in presenting the 10th Annual Report on thebusiness and operations of the company together with the audited Financial Statementsalong with the report of Auditors for the financial year ended March 31 2019.
Our Financial Performance for the year ended March 31 2019 is summarized below:
(Amount in Rs.)
PERFORMANCE SUMMARY AND STATE OF AFFAIRS
We have achieved an operational turnover of Rs. 150.24 Crore and Profit after Tax (PAT)of Rs.2.63 Crore for the FY 2018-19 as against an operational turnover of Rs.142.49 Croresand profit after tax (PAT) of Rs.2.51 Crores for the FY 2017-18.
Despite macro level issues which worked against the prospects of the Company'sbusiness we could report revenues and profitability better than that of previous year. Wehave been persistently working towards increasing the revenues and profitability in everypossible manner.
With the aforesaid performance in the hindsight we at the management level aredefinitely spirited to record better results in the ensuing Financial Year.
TRANSFER TO RESERVES:
We donot propose any amount to be transferred to the Reserves for the current FinancialYear.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE COMPANY
There have been no material changes and commitments affecting the financial position ofthe company between the end of the financial year and the date of this report.
NATURE OF BUSINESS
There has been no change in the nature of business of your Company during the FY ended31st March 2019.
As you are aware the capital base of the Company has almost doubled during the FY2018-19. However there has been no corresponding increase in the distributable profitsfor the said FY. In this backdrop recommending any Dividend would create undue pressureon the financial position of the Company. Hence the Board of Directors donot recommendany dividend for the financial year ended 31st March 2019.
During the FY ended 31st March 2019 the following Corporate Restructuring measureswere undertaken / completed successfully:
1. The merger of DRS Warehousing (South) Private Limited the wholly owned subsidiarywith the Company vide a Scheme of Amalgamation between DRS Dilip Roadlines Private Limited(Transferee Company) and DRS Warehousing (South) Private Limited (Transferor Company) andtheir respective Shareholders and Creditors U/s 233 of the Companies Act 2013 effective01st April 2017 was confirmed by the Regional Director vide Order Dated 25.05.2018.
2. Subsequently the status of the Company was changed from Private Limited to PublicLimited Company and the name of the Company was changed to DRS Dilip Roadlines Limited. Afresh certificate of incorporation consequent upon conversion from Private Limited toPublic Limited was issued by the Registrar of Companies Hyderabad Telangana on September06 2018.
3. During the year under review 3854403 equity shares of Rs.10 each were issued andallotted by way of Bonus in the ratio of 11:20 in order to capitalize a sum ofRs.38544030 standing against securities premium account in the books of the Company.
4. INITIAL PUBLIC OFFER
As you are aware your Company conducted an IPO of its equity shares wherein 42 lacswere subscribed by the Public thus raising an amount of Rs.31.5 Crores. Your Company gotlisted on the SME platform of the National Stock Exchange of India i.e. NSE Emerge. Theprimary objectives of the issue were to raise funds for setting up new branches settingup additional warehouses and to repay the debts.:
This will help the Company reduce its dependence on borrowed funds and in turn reduceits debt burden. With the ease of availability of funds at its disposal your managementhopes the Company will be able to overcome the funding obstacles and will be able to planits future course of action in a better manner.
The capital structure of the Company as on March 31 2019 stands as mentioned below:
UTILIZATION OF IPO PROCEEDS - DEVIATION THEREIN:
As mentioned elsewhere in this Report your Company raised an amount of Rs.31.50 Croresby way of IPO. The said IPO proceeds have been deployed as per the Objects and schedulementioned in the Offer Document. However an amount of Rs.2.44 Crores was used towardspurchase of trucks and for General Corporate purposes instead of part payment of termloans due to urgent business needs.
The deployment of IPO proceeds has been reviewed by the Audit Committee of the Companyand has been certified by the Statutory Auditors. However pursuant to the undertakingmade during Half yearly results and also as a matter of good Corporate Governance andtransparency relevant draft resolution seeking consent of members for ratifying the saiddeviation is being proposed in the Notice attached herewith.
In the said regard necessary disclosures have already been made to the Stock Exchangepursuant to SEBI (Listing Obligations And Disclosure Requirements) Regulations 2015.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Board of Directors is duly constituted and has optimum combination of bothexecutive and non-executive directors
Key Managerial Personnel:
Pursuant to the provisions of Section 152 of the Companies Act 2013 and in accordancewith provisions of Articles of Association of the Company Mrs. Shamantha Dodla retiresby rotation at the ensuing AGM and being eligible offers herself for re-appointment.
DECLARATION BY INDEPENDENT DIRECTORS:
The Company has received respective declarations from both its Independent Directorsconfirming that they meet the criteria of independence as prescribed under sub-section (6)of Section 149 of the Companies Act 2013 and Regulation 16(1)(b) of SEBI (LODR)Regulations2015.
COMPOSITION OF BOARD COMMITTEES
We have in place all the Committees of the Board which are required to be constitutedunder the Companies Act 2013 and SEBI ( Listing Obligations and Disclosure Requirements)Regulations 2015.
The following are the committees of the Board:
In terms of the requirements of the Companies Act 2013 and the Listing Regulations anannual performance evaluation of the Board is undertaken where the Board formally assessesits own performance with an aim to improve the effectiveness of the Board and theCommittees.
During the year Board Evaluation cycle was completed by the Company internally whichincluded the evaluation of the Board as a whole its Committees as well as peer evaluationof directors. The exercise was led by the Chairman of Nomination and RemunerationCommittee of the Company. The evaluation process focused on various aspects of thefunctioning of the Board and Committees such as composition of the Board and itscommittees experience and competencies performance of special duties and obligationsgovernance issues etc. As an outcome of the exercise it was noted that the Board as awhole is functioning as cohesive body which is well engaged with different perspectives..Further performance evaluation was also carried out for Mrs.Shamantha Dodla who retiresby rotation and being eligible has offered herself for reappointment.
Also the performance of the Independent Directors was evaluated by the entire Board ofDirectors and all the Independent Directors fulfills the independence criteria and areindependent of the management as set out in the provisions of the Companies Act 2013 readwith SEBI ( Listing Obligations and Disclosure Requirements) Regulations 2015.
POLICY ON DIRECTORS' APPOINTMENT REMUNERATION ETC.
The following policies are attached herewith and marked as Annexure VII andVIII respectively:
a. Policy for selection of Directors including qualifications positive attributes andindependence of a director evaluation mechanism.
b. Remuneration Policy for Directors Key managerial Personnel and other employees.
MEETINGS OF THE BOARD OF DIRECTORS
The meetings of the Board are scheduled at regular intervals to discuss and decide onbusiness performance policies strategies and other matters of significance.
The Board has duly met 13 times during the Financial Year 2018-19 i.e.10th April201820th April2018 1st May2018 23rd June2018 1st July201820th July2018 8th August 2018 3rd September2018 7thSeptember2018 24th September2018 6th December2018 10thDecember2018 and 22nd January2019. The intervening gap between any twoconsecutive Board Meetings was within the period prescribed under the provisions of theCompanies Act 2013.
Attendance in the Board Meetings:
INTERNAL FINANCIAL CONTROL SYSTEMS
We have adopted policies and procedures which enables implementation of appropriateinternal financial controls across the organization and also ensures the orderly andefficient conduct of business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of fraud error reportingmechanism the accuracy and completeness of the accounting records and timely preparationof reliable financial disclosures. Internal Financial Controls are an integrated part ofthe Risk Management Process addressing financial and financial reporting risks. TheInternal Financial Controls have been documented digitized and embedded in the businessprocess.
Assurance on the effectiveness of the Internal Financial Controls is obtained throughour management reviews control self-assessment continuous monitoring by functionalexperts as well as testing of the Internal Financial Control systems by the InternalAuditor during the course of audits. We believe that these systems provide reasonableassurance that our Internal Financial Controls are in commensurate with the requirementsof our organization.
The tenure of Statutory Auditors M. Anandam & Co Chartered Accountants expires onthe conclusion of 10th Annual General Meeting.
Hence it is being proposed to appoint on approval of members of the Company -M/s Ramanatham & Rao Chartered Accountants(Registration No 002934S) as theStatutory Auditors of the Company to hold office for a period of 5 years i.e.; from theconclusion of the 10th Annual General Meeting till the conclusion of the 15thAnnual General Meeting at such remuneration as may be agreed upon by the Board ofDirectors and the Auditors in addition to the reimbursement of all out of pocket expensesincurred in connection therewith.
The Board of Directors based on the recommendations of the Audit Committee hasre-appointed M/s. A Tibrewala & Associates Chartered Accountants Hyderabad as theInternal Auditors of the Company who are submitting its report on quarterly basis.
Pursuant to the provisions of Section 204 of Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed Mr. Anand Kumar C. Kasat Company Secretary in Practice to undertake thesecretarial audit of the Company.
The copy of said Secretarial Audit Report is attached herewith and marked as AnnexureII.
Statutory Auditor's Observations:
Secretarial Auditors' Observations:
We would like to clarify that the instances of delay reported by the SecretarialAuditor were just clerical in nature and self-explanatory. Further deviation inutilisation of IPO proceeds has been already explained elsewhere in this Report.
In view of the said no further explanation is being provided thereon.
We confirm that the maintenance of cost records has not been specified by the CentralGovernment under section 148(1) of the Companies Act 2013 and hence accounts and recordsrelated thereto are not required to be made or maintained.
The Company complies with all the applicable Secretarial Standards issued by TheInstitute of Company Secretaries of India.
CONTRACTS OR AGREEMENTS WITH RELATED PARTIES
During the FY under review transactions were conducted by the Company pursuant to theAgreements entered into with its Related Parties during previous years / financial yearunder review; the same were on an arm's length basis and in the ordinary course ofbusiness. There are no materially significant related party transactions made by theCompany with the Promoters Directors Key Managerial Personnel or any related party whichmay have a potential conflict with the interest of the Company at large.
As a matter of Company's Policy all Related Party Transactions are placed before theAudit Committee and the Board for its approval.
The details of related party transactions which were entered into during the previousyears/ current year are provided in the Note No. 31 forming part of the notes to financialstatements.
As per Section 134(3)(h) of the Companies act 2013 the particulars of related partytransactions as referred to in Section 188(1) of the Companies act 2013 have beendisclosed in Form No. AOC 2 which is appended as Annexure I tothis Report.
We have neither accepted nor repaid any deposits during the FY ended 31st March 2019.Further there were no outstanding deposits as at the beginning of the FY or at any timeduring the FY 2019. Hence there are no details to be provided pursuant to Rule 8 (5) (v)& (vi) of Companies (Accounts) Rules 2014.
Further the details of unsecured loans borrowed from Directors during the FY ended 31stMarch 2019 and / or outstanding as on the said date are as hereunder:
Further the said Directors have provided declaration(s) in writing that the amountslent by them are their own funds and not been given out of funds acquired by them byborrowing or accepting loans or deposits from others.
In accordance with Section 134 (3) (a) of the Companies Act 2013 an extract of theAnnual Return in the prescribed format i.e. Form MGT -9 is appended as AnnexureIV to this Report and the same is uploaded on the website of the Companywww.drsdilip.in.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
In terms of the provisions of Section 177 of the Companies Act 2013 and Regulation 22of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the Companyhas formalized the process and institutionalized Whistle Blower Policy' within theCompany whereby employees and other stakeholders can report matters such as genericgrievances corruption misconduct illegality and wastage/misappropriation of assets tothe Company.
The policy safeguards the whistle blowers to report concerns or grievances and alsoprovides direct access to the Chairman of the Audit Committee.
The details of the vigil mechanism are provided in the Annexure IX tothis Report.
We have been following the principle of risk minimization vis a vis our business needsand the industry norms.
The Role of Risk Management department includes the implementation of Risk ManagementSystems and framework review of the Company's financial and risk management policiesassessment of Risk and Procedures to minimize the same.
The Department has been entrusted with the responsibility to assist the Board in
(a) overseeing and approving the Company's enterprise wide risk management frameworkand b) overseeing that all the risks that the organization faces such as financialliquidity security property IT legal regulatory reputational and other risks havebeen identified and assessed and ensuring that there is an adequate risk managementmechanism in place capable of addressing those risks.
The details of the Committee and its terms of reference are set out in the CorporateGovernance Report forming part of the Board's Report.
MANAGEMENT DISCUSSION AND ANALYSIS
In accordance with the provisions of SEBI (LODR) Regulations 2015 a Report on theManagement Discussion and Analysis is set out in AnnexureV attachedto this Report
Highest standards of Corporate Governance practices are maintained and followed inevery walk of life of our Company. Corporate Governance is intended to increase theaccountability of the company and avoid massive disasters before they occur. CorporateGovernance is adopted in order to create a corporate culture of transparencyaccountability and disclosure.
DISPATCH OF ANNUAL REPORTS
In compliance of the applicable provisions we shall dispatch the Annual Report for theFY 2018-19 in electronic format to all our members whose E-Mail addresses are registeredand updated with our Registrar & Transfer Agents. To all the other members the AnnualReport will be sent in physical format.
LISTING & TRADING
Our Equity Shares are listed on NSE India Limited Mumbai. The listing fee for thefinancial year 2018-19 has been duly paid. You may further note that the listing/ tradingwas never suspended at any time during the financial year 2018-19.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 ( 1) of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 and as amended inrespect of our employees is attached herewith and marked as Annexure VI (i).
We do hereby affirm that the remuneration paid is as per the Remuneration Policy forDirectors Key Managerial Personnel and other Employees.
Further we do not have any employee whose remuneration falls within the purview of thelimits prescribed under the provisions of Section 197 of the Companies Act 2013 readwith Rule 5(2) (i)& (ii) of the Companies ( Appointment and Remuneration of ManagerialPersonnel) Rules 2014 i.e.Rs.8.5 lakhs per month or Rs.1.02Crores per annum
Moreover no employee was in receipt of remuneration in excess of that drawn by theManaging Director or Whole Time Director and holds by himself or along with his spouse anddependent children not less than two percent of the equity shares of the company..
Further details of top ten employees in terms of remuneration drawn during thefinancial year ended 31st March 2019 as required under Rule 5(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 as amendedfrom time to time is attached herewith and marked as Annexure- VI (ii).
LOANS GUARANTEES OR INVESTMENTS
We have not given any loan or made investment or given guarantee or provided securityas envisaged under Section 186 of the Act.
DEMATERIALIZATION OF SHARES
100% of the total paid up equity shares of our Company are in dematerialized form as on31st March 2019. (Only 48 Shares are in Physical form the percentage of whichis very negligible).
DIRECTORS' RESPONSIBILITY STATEMENT:
As required under Section 134(5) of the Companies Act 2013 the Directors confirmthat:
i. In the preparation of the Annual Accounts the applicable Accounting Standards havebeen followed and that no material departures are made from the same ;
ii. The Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the company at the end of the Financial year and ofthe profits of the company for the period;
iii. Proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;
iv. The annual accounts have been prepared on a going concern basis.
v. They have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and are operating effectively;
vi. They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no orders passed by the Regulators / Courts which would impact the goingconcern status of your Company and its future operations.
Further we confirm that there were no instances of fraud to be reported by theAuditors vide their Report for the FY 2018-19.
POLICY ON PREVENTION PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORK PLACE:
We strongly support the rights of all our employees to work in harassment freeenvironment. We have adopted a Policy on Prevention Prohibition and Redressal of SexualHarassment at workplace as per the provisions of the Sexual Harassment of Women atWorkplace (Prevention Prohibition and Redressal) Act 2013 ( 'POSH Act") andthe Rules made thereunder. The policy aims to provide protection to Employees at theworkplace and prevent and redress complaints of sexual harassment and for mattersconnected or incidental thereto with the objective of providing a safe workingenvironment where Employees feel secure.
Further we have in place a Committee under the name and style "InternalComplaints Committee" in compliance of POSH Act which looks into various mattersconcerning harassment if any against women at workplace addresses concerns andcomplaints of sexual harassment and recommends appropriate action. Details of compositionetc. of the said committee are provided in the section on Corporate Governance.
We further confirm that during the year under review there were no cases filedpursuant to the said Act.
CORPORATE SOCIAL RESPONSIBILITY
Since our Company does not fall within any of the parameters specified under theprovisions of Section 135 of the Companies Act 2013 read with Rules made thereunderreporting pursuant to Section 134(3) (o) is Not Applicable.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO
The Particulars as prescribed pursuant to the provisions of Section 134(3)(m) of theCompanies Act 2013 read with Rule 8 of The Companies (Accounts) Rules 2014 areprovided in Annexure III to this Report.
ACKNOWLEDGEMENTS AND APPRECIATIONS
We take on record the contribution made by the employees of the Company and acknowledgetheir hard work and dedication to ensure that the Company consistently outgrows itsprevious performance. Further we wish to express our sincere appreciation towards all thecustomers suppliers banks financial institutions advisors Government of India andGovernment Departments concerned State Governments and other authorities for theirsustained support and co-operation towards contributing to the Company's success.
We are also deeply grateful to our shareholders for the confidence and faith that theyhave always placed in us.